Question

For wach of the following errors, describe to a recently hired bookkeeper how it would be shown on a cash reconciliation:

1) Bank recoreded a deposit of $200 as $2000

2) Mistakenly recorded a deposit of $530 as $350

3) Mistakenly recorded a payment of $250 received from a customer as $25 on the bank deposit slip. Bank caught the error & made the deposit for the correct amount.

4) Bank statement shows a check written by the company for $255 was erroneously paid (cleared the account) as $225

5) Wrote a check for $369 but erroneously wrote down $396 as the cash disbursement on the company's records.

Answer 1

Answer-

1-The bank recorded a deposit of $200 as $2,000:

In this case we must deduct $1,800(i.e. $2000 - $200) in the bank statement.

2-The company bookkeeper mistakenly reported a deposit of $530 as $350:

In this case the bookkeeper has made a mistake in his books. Balance as per bank is correct. So we need to add $180 (i.e $530-$350) to the book balance.

3-The company bookkeeper mistakenly recorded a payment of $250 received from a customer as $25 on the bank deposit slip. The bank caught the error and made the deposit for the correct amount.

In this case the check is correctly posted by the bookkeeper in the customer and bank ledger account. Then there is no necessary change that is needed to be made. As mistake was just made in the bank slip. But if in case the bookkeeper made the mistake in posting the check correctly in books also then we need to add $225 to the balance as per books.

4-The bank statement shows a check written by the company for $255 was erroneously paid as $225.

This error is made by the bank. In this case we need to deduct $30 from the balance as per bank.

5-The bookkeeper wrote a check for $369 but erroneously wrote down $396 as the cash disbursement on the company records:

In this case the bookkeeper made a mistake and recorded a disbursement higher which is higher. Thus we need to add $27 to the balance as per books.